The Hidden Costs of Corporate Protectionism

If you criticize ExxonMobil for generating $40 billion per year, then Austrians would respond to you and cite that its profit margin is only 9%. However, the 9% is higher than it should be. The profit margin should be less than 2%.

Many Austrian School economists do not actually understand the Austrian theory of the Business Cycle. They think that it is just a miscalculation error, but it is actually much deeper than that. Speculation during the cycle is purposefully increased. An example is the Chinese correction on February 27, 2007. It started out with rumors lowering the central bank interest rate and the speculators crashed.

Negative real interest rates do not have to be negative

In a purely free market, the profit margin of every capitalist equals the total equity times the market interest rate. For example, if a factory is valued at $10 million and the market interest rate is 5%, then each year the capitalist would earn $500,000.

However, due to the lower interest rates that can be borrowed at the Federal Reserve System, capitalists would invest more. For example, if the Federal funds rate is lowered to 2%, the capitalist would borrow $10 million to invest in a factory. He would then earn $500,000, as usual per year. However, because the Federal funds rate is only 2%, he has to only return $200,000 to the Federal Reserve System. Thus, he would earn $300,000 ($500,000 of factory profits minus $200,000 interest), by borrowing at lower interest rates. It is accurate to interpret that the interest rates are negative, because he had earned $300,000 out of nothing.

Thus, due to the lower Federal funds rate than the natural market rate, it would rise to negative real interest rates and overinvestment, even if inflation has never happened. This encourages malinvestment and speculation. Expansion of businesses would occur, and the expansion would stop until the real interest rates are not negative anymore when the net income divided by the equity of factory capital approaches the Federal funds rate.

If inflation has occurred, then it would get more speculation. The raising income inequaity is due to speculation.

The catallactics of inflation

Investment would increase in long-term capital goods such as factories, since only long-term capital would profit the capitalist. Short-term profit margin from sales would not increase since they do not profit the capitalist.

The prices of long-term goods increase more than short-term goods. If speculators predict that the money supply would double over the next year, then they would bid up the price of the long-term goods in order to sell it next year, to profit from negative real interest rates. However, because of the increased demand for long-term goods from speculators, the prices of long-term goods raise immediately, before any increases in money supply. This would bring down the profit from the negative interest rates. This demonstrates that prediction or speculation, besides money supply, would have a great impact in prices.

If the long-term goods require labor to build, then the wages of building long-term goods would temporary increase, and eventually decrease to equilibrium as more individuals switch to these jobs.

Short-term goods, conversely, are not affected by prediction or speculation. Short-term goods like wheat and corn would not last very long. Thus, the prices of short-term goods are dependent on the money supply, without any prediction or speculatory influences. The prices of short-term goods would double only if the money supply is actually doubled.

As long as the speculators profit from the market interest rate, plus the risk, the prices of long-term goods can raise arbitrarily. Speculators may bid up the prices of long-term goods multiple times if they predict that inflation would multiply over the next year. Thus, inflation hurts the non-capitalists, and may even benefit the capitalists because they can sell their capital and use the money to consume cheap short-term goods.

There are three kinds of individuals. The entrepreneur innovates for profit. The capitalist gets profit from interest payments. The speculator predicts the intertemporal patterns to profit. The entrepreneurs are the productive class. Capitalists, the owners of capital, profit from interest rates. Speculators may lobby politicians that would increase or decrease inflation. Resources are wasted to the speculators. The speculators do not do any contributions to society, but still profit. This redistributes the wealth from the productive individuals to the speculators.

The real profits

Many Austrian economists confuse profit margin with return on equity. The profit margin is the percentage of net income occurring from sales revenue. The return on equity is the net income divided by the total equity. The profit margin should be much less than the market interest rate, and the return on equity should equal the market interest rate.

If the Federal funds rate is lower than the market interest rate, the market interest rate would equal the Federal funds rate. If the market interest rates are higher, then borrowers would borrow from the Federal Reserve System. This decrease demand from the market interest loaners, which would cause the market interest rates to equal the Federal funds rate.

Total equity is the total capital invested. Assuming that there are no liabilities, then in a purely unhampered free market, the return on investment (ROI) should be the net income divided by total equity.

If you see Google finance, the return on equity for ExxonMobil is 35%, which is much higher than 2%. The return on equity for monopolized firms such as Microsoft is 50%, which is much higher for 2%.

So ExxonMobil's return on equity is much higher than the market interest rate.

But what if there are liabilities? The return on investment is the net income plus the total liabilities times the market interest rate, then divided by the total equity.

ROI = (Net_income + Total_liability * Market_interest_rate) / Total_equity

This equation is derived from this equation:

Total_equity * ROI - Total_liability * Market_interest_rate = Net_income

If you add everything after the ROI and divide Total_equity, then you should get the first equation.

But since there are artificially below market interest rates such as the Federal funds rate, the market interest rate is the Federal funds rate. The Federal funds rate is currently at 2%.

For example, if you take the ExxonMobil statistics. The net income is 40,610.00, total liability is 120,320.00 and total equity is 121,762.00.

If you calculate, then you would get (40,610.00 + 120,320.00 * 0.02) / 121,762.00 = 35.3%. You then found out that the ROI of ExxonMobil is 35.3%, which is much higher than 2%.

If the total liability is not much greater than the total equity, then return on equity is fairly a good measure for ROI, since the 2% Federal funds rate is insignificant to make any difference.

Defending the criticizers

If you heard arguments defending

ExxonMobil, you shouldn't trust them. First, ExxonMobil practices tax loopholes that understate their net income. Second, the profit margin shouldn't be confused with the return on investment. Third, the return on investment is much higher than it should be.

Why does ExxonMobil has such a high ROI? The only answer is regulatory capture.

In a purely free market, the interest rate would be much lower because of the lack of banking regulations. Everyone can loan their capital at interest, which increases the supply of capital that decreases demand and interest rate. If the natural interest is 1% in a purely free market, then the capitalist of the $10 million valued factory would only earn $100,000 per year. The money monopoly should be vanished.

Assuming Gulit

Imagine an intruder came into your house. Commonly accepted actions would be to shoot the intruder. But Homo sapiens irrationally ignore these potential contexts:

• The intruder is actually a friend of your wife or children.
• The intruder confused your house with a retail store, or your house looks like a retail store.
• The intruder thought that you are having a garage sale, so he went in.
• You left a door open and your house looked like a supermarket.
• The intruder is actually a canvasser, and that he actually misinterpreted your words and he thought you said "you can go inside my house."
• Your wife or children invited their friend into your house, and you thought the friend is an intruder.
• You mistakened the intruder with your family. For example, when your children are dressed up in a costume that you mistaken as an intruder.
• etc.

These special exceptions occur much more than it happens, known as the subjective theory of coercion. Should you shoot an intruder who is in your house? Yes, if you clearly know that it is actually an intruder and he is not a confused or your friend. But because it is impossible to know that if it is really an intruder, it is very hard to choose..

Home intruder

One example in the mainstream media is these case when a human shoots an alleged trespasser. A homeowner, whose habit is to read the newspaper every morning 4:45 a.m. with his garage door open. A stranger came into his garage. The homeowner shot the stranger. There were no charges.

One news report claimed that the homeowner heard "noise coming from the garage." so he shot the stranger. Another news report of the same thing claimed that it is his habit to sit in his garage at 4:45 a.m. with his door open and the intruder threatened him. The two news reports are obviously contradictory. The first implied that it was an intruder who sneaked into his garage when he was sleeping. The second implied that it is his habit and he was awoke with is garage open. These kinds of contradictory news occurs much more often than you think in the mainstream media. The homeowner was likely lying that the intruder threatened him because on the first report he claimed that he heard noises.

This source suggests that the homeowner has a past history of violence, and he shot three people in history, and he was not sentenced in two cases of shooting.

Another news report of the same case wrote in a tone that suggests that he was really an intruder and the homeowner's garage was closed. Many comments cheered for the homeowner to shoot the intruder, and suggested that the homeowner should shoot the intruder to death so he would not waste taxpayer money in the hospital or in prison.

These three reports are clearly mainstream media lies.

What if the intruder actually thought that the homeowner was actually having a garage sale?

Various comments about the news such as:

Probation for the gun charge. A citizens appreciation letter from the city for taking care of a dirt bag. Stay out of people's garages at 0445hrs and this wont happen again.

The writer of the comment told us to "stay out of people's garages at 4:45 a.m." What if the homeowner actually has a house that looked like a retail store or a garage sale? There are not any specific law that said to stay out of people's garages at the time. Therefore, the writer of the comment is trying to make a law by himself. There is no objective law prohibiting staying our of people's garages at 4:45 a.m., and it is dangerous to subjectively consider if it is coercion.

Another comment said:

Yeah, well, threaten my house and expect the same treatment. Strangers on my property at 0445 are looking to commit a crime. (to Anne) substitute criminals for citizens (should be nervous).

As said, the homeowner claimed that the intruder threatened him may be lying. He assumed that the intruder was not threatened.

Trespassing

Another news case happened when a suspected trespasser went into a lawn of someone, and the homeowner chased the trespasser out and then shot him.

What if the trespasser was actually a friend of the homeowner's children? It is! See this comment:

Get an actual paper this morning. It runs the entire story. The guy shot a kid who was visiting his teen daughters. They were invited by his daughters. not trespassing. I don't know why the CL ran a partial online, but this wasn't justified according to what the actual paper reported.

So the news report is false, and another mainstream propaganda lie.

Suppossed "trespasser" shot

This link shows that mainstream media reported that a trespasser went into property owned by someone but got shot. However, the trespasser was not on his property, and was shot in the back. The media lied that he was really a trespasser and comments on the news first thought that he really trespassed and congradulated the shooter, but soon the victim's family concluded that he was not really on his property and got shot in the back. The victim's family sees the murdered person as someone who was innocent.

Samy "worm"

Samy, a user of MySpace, putted JavaScript on his page that added a million "friends" on his profile and placing "but most of all, Samy is my hero" to each profile infected. This is clearly a harmless script. However, he is sentenced of a felony to 90 days of community service and three years of prohibition and banishment from the Internet during the probation period.

He made himself a million friends. What is harmful about that? This is perfectly harmless because he just put a "but most of all, Samy is my hero" on each profile infected. He didn't modify anything else.'

But many mainstream media news reports suggested that Samy's sentence was not outrageous. This is mainstream propaganda. Also, it said that the harmless worm "infecting peoples machines," which clearly did not.

MySpace hired lawyers to promote propaganda that the "hacker" has actually harmed the site: "MySpace is committed to protecting our community from any abusive misuse of the site"

To demonstrate the harmless of the act, imagine this. He put JavaScript code on MySpace that exploited a bug on Internet Explorer and Firefox that helped him add friends. What if someone made his own browser full of bugs that performed a similar result? It is the browser company's fault that they did not fix the bugs. But because Internet Explorer and Firefox are popular browsers, Samy was punish. If Internet Explorer and Firefox were not popular browsers, Samy would not be punished.

If MySpace wanted to punish Samy, then MySpace must clearly say that it would punish individuals who put JavaScript that would add friends. But because MySpace didn't clearly specify that, he should not be punished.

Therefore Samy didn't so any harm.

Experienced internet users criticized the analogy to keeping a door open to a store should be punished and computer crime should also be punished.

Unlike physical security, making a computer system secure against teenage hackers is not rocket science. This vulnerability was clearly a MySpace screwup, and they should be held responsible and pay the price for it. That principle may not be so important when it comes to MySpace (because there is little of value there), but it becomes of paramount importance when it's your bank or your hospital.

Comments such as this:

This is such *****. It sounds to me like punishing someone for glitching in an online game. The loop whole was there and he exploited it, banishment from myspace makes sense, but this is insane. I will never stand trial before a jury of my idiot peers. My tax money helped prosecute this guy???? Damn fascists.

oh thats just stupid, what the hell.. thats so unfair that kid didnt even do anything harmful.. if it wasnt him it would been someone else. god myspace are a bunch of *****. myspace should be banned from the internet not him

i dont understand.. he just found a loophole in myspace that let him acquire more friends, which seems to be the point of myspace in the first place :) its all about the number of people on your friends list.. its highschool popularity contest all over again.. they could have, and did fix the hole.. so to go after him is stupid. and the punishment doesnt fit the crime, they should have said "dont do that again"..

This is ***** ridiculous. He saw the security whole, contacted myspace, watched them do nothing, then merely demonstrated that it exists and is exploitable in a very obvious, very pointless way that was completely fixed. No harm was done to any users or myspace's infrastructure, save maybe a day of work for the people at myspace that they SHOULD'VE done anyway. He could've earned thousands in ad revenue through abusing this descretely in the time it would've taken them to notice, or even created a network of tens of thousands of bots which could be sold off for far more or done hundreds of thousands in damages to myspace of any other online company of his choosing... Instead he decides to have some fun in a non-important way to point it out... So what do the people at Myspace do? They ***** decide to prosecute him out of spite for making them do something they should've done anyway! More benevolent companies with less assholish philosophies and owners would've offered the guy a ***** job, but this guy gets his chances of getting a job pretty much screwed for quite a while. How is an AJAX programmer supposed to get a job in which he isn't allowed any internet access?... What the hell kind of harm could he do to the internet if he was allowed to access the internet? I thought this Kevin Mitnick ***** was over, ***** myspace and ***** this judge.

Solution

A solution to solve the subjectiveness of coercion is to have voluntary associations objectively that define coercion.

A rule-of-thumb for anarchists is to have punishment to be proportional. However, it is impossible to determine the proportional amount, as the value of damage is subjective. Therefore, voluntary associations should define the limits. An example is voluntary limited liability contracts, that defines the amount of punishment.

If punishment is highly high, then businesses would not take any risks. If punishment is too low, than individuals would be injured. It is the individual's responsibility to select a voluntary association that would regulate the amount of punishment.

"Our trade deficit implies that foreigners are stealing our wealth. We deserve the right to [retaliate against them on our self-defense]."

"The poor should be taxed more and the rich should be taxed less."

"Law-abiding citizens should shoot and kill all the [falsely accused] scumbags so they won't reproduce."

"Small businesses should be taxed more than big businesses."

"We [corporation] have the right to protect our intellectual property. We have the right to [murder] these criminals who developed our patented idea independently."

"Because you are [within the airspace above my geographical territory], I have the right to do anything that I want [murder] with you."

Problems with Moral Terminology

Ideology vs. strategy

Today, many individuals identify themselves in a political ideology. These ideologies include agorist, anarchist, individualist, collectivist, libertarian or conservative. These are purely labels, and would inevitable result in controversial debates from the incompatibleness of these terms.

Let's first distinguish between an ideology, movement and strategy. An ideology is the result of a movement or strategy. Ideologies can be achieved in multiple strategies. A strategy is a descriptive, or explanatory method to result achieve an ideology. Strategies are concrete, in that they are methods, not general ideas. Ideologies are more abstract than strategies, as there are multiple ways of strategy.

Strategies are often incompatible to each other. For example, one strategy to achieve libertarianism is anti-political strategy, and another is using politics. Many anti-political agorists see the political libertarians are incompatible, vice versa. They argue that the other one isn't a libertarian. However, outsiders of libertarianism see that the anti-political and political strategies the same, and both are subsets of libertarianism.

Ideologies can be very general, moderately abstract, or concrete. For example, libertarianism is a moderately abstract ideology, which is the means to achieve liberty. There are many strategies to achieve liberty. One strategy is using non-political means, such as agorism. Another is using libertarian socialism, or collective ownership of capital goods to achieve liberty. Even another is using the state to set central planning strategies to achieve liberty. Proponents of these three ideologies mentioned may all identify themselves as libertarian. Since libertarianism is a very general term describing any ideology to achieve liberty, anyone, including fascists, can identify themselves as a libertarian.

Homo sapien irrationality

Inevitably, because strategies are incompatible, proponents of each strategy start to use name-calling methods, such as using "you are not a libertarian," to monopolize the term. These would result in label wars, and these wars are caused by the territorial behavior that is innate by humans. But the root of these wars are caused by the irrationality of Homo sapiens.

It is general knowledge that all Homo sapiens are unbelievably irrational. Irrational biases are all around human behavior. These behaviors are passed on by evolution, as adaptations to surrounding environments. Because of these biases, humans often subscribe to general concepts, which is void of any concrete identifier identifying the concept. This is the called problem of universals.

These behavior is exemplified by contemporary political attitudes. Political terms such as left-wing, right-wing, libertarian, conservative, liberal, fascist and moderate do not have any identifying attribute that is unique. Right-wingers often use the term left-wing as a catch-all phrase, grouping all ideologies that he opposes, without any specific characteristic that is inherent in the left-wing ideology. These happens to left-wingers, as they debunk all ideologies that they disagree on as right-wing. One prominent example is the mainstream media. Right-wingers see the media as left-wing bias, and vice versa.

Label wars

Common political terms, because they are so abstract, would be fought on against each other. A solution is to use more specific terms, describing strategies, as opposed to more abstract ideologies. An easy solution is to replace libertarian with propertarian, liberal with economic interventionist, conservative with cultural conservative, and fascist with totalitarian.

Due to various interpretations, a fascist can also be a libertarian, because he believes that economic interventionism would result in more personal liberty. A authoritarian can also be a libertarian, because he believes that authority would result in order and liberty of each individual.

Evil is intrinsic to politicians

One popular question that is asked compares the evilness of leaders. Questions may be these "Is Hitler or Stalin more evil?," "Is Bush more evil than Hitler?" etc. At first glance, these answers may be obvious. But further examination would raise questions like "Stalin killed more people, but Hitler killed people because of their race, so Stalin is less evil." These problems are much more difficult to evaluate than their first appearance. Both Stalin, Hitler and Bush killed humans directly. So all three should be equivalently as evil. But some would argue that since Bush killed humans, albeit directly, is for "national defense," Bush is less evil than Stalin. However, a closer look suggests that they are the same. Both Bush and Stalin directly killed people because they thought that not killing people would result in less liberty overall. Stalin could have believed that killing people would keep him in power longer so he would reform the economy to prosperity, which would result in more liberty overall. Bush may have believed that killing people would result in more liberty overall. Hitler could have believed in the same thing. He could have believed that overall, killing the "inferior races" would result in more liberty. Thus, we should conclude that these three leaders are equivalently evil; they just have different beliefs of their strategies to achieve an ideology: liberty.

We have discussed that the direct murderers are equivalently evil, but what we have not examined is those who are indirectly murderers. Nearly every politician has indirectly stole, murdered or otherwise hurt some people at the expense of another. Contemporary politicians of all political parties indirectly stole and murdered some people. For example, some may have set tariffs that led to famine and malnutrition that caused the death of millions of individuals. Some may consider that those who indirectly damage Homo sapiens are not as evil as those who directly did. But their argument depends on the definition of "evilness." Is it evil for some who unintentionally murdered or is it evil for someone who intentionally murdered?

It is a product of irrationality that caused the indirect murders and harmful consequences. The more irrational the politician is, the more likely that he would indirectly harm individuals. Politicians, after all, do not have any obligation to be more rational. They do not have any incentives nor responsibility for their irrational actions. If they could spend more time deciding their choices, they would hurt individual less. Since politicians are selfish and do not want to spend time deciding the quality of their choices, they are indirectly contributing to murder and damage to Homo sapiens. Therefore, indirect torts should be evil as well.

Popular politicians such as Hugo Chavez and Fidel Castro may be perfectly nice on their ideology, but it is their irrational strategy that caused the deaths of individuals. Strategy is a very important aspect to achieve an ideology. Strategy is high dependent of rationality, which most Homo sapiens lack. Therefore, it is the irrationality of Homo sapiens that should be fixed.

Defederalization is Overrated

Competition is non-existent at the subnational state level. The number of subnational states are limited. Not all permutations of preferences would be availiable. For example, one state may support corporations but oppose taxation. Another state may oppose corporations but support taxation. There are a limited number of combinations. The legislatures at each state would override individuals quickly. Also, individuals do not have the incentive to move from state to state. There is no real competition. If individuals do have an incentive to move, then the state would be already abolished. This is still a popularity contest.

Even if the state dismantled into hundreds of autonomous municipalities, it would be still be the same. Capitalists would still have the capital to fund propaganda to delude individuals. Capitalists would fund politicans who would re-unite the manicipalities.

If the state was suddenly abolished, capitalists would fund another state. The capitalists' supply of money are unlimited. Multinational corporations would use their money from foreign states to fund a new state.

Multinational corporations would fund wars between each others' states so individuals would choose to elect politicians who unite the states. Multinational corporations would fund violence to show that conflict would arise if there are too many autonomous municipalities. Therefore, individuals would be believe that unity is required.

Unless individuals are convinced that anarchy is the solution, capitalists would fund propaganda to show that anarchy equates violence.

The state's existence entails the majority's consent. If the majority do not consent, they would revolt against the state. This is simply because majorities possess significantly more physical force than the minority that control the state. Unless the majority is disarmed, the state resides on majority acceptance.

Like anarchism, autonomous municipalism would not work without the majority's consent. As said, the capitalists would use anything to convince the majority to vote for pro-union politicans or collude the municipalities. Anyway, federalism is shifting the popularity contest to sub-national states.

The solution is to convince the majority that free markets are the best system. If a purely free market system is adopted that contradict's the majority's consent, then the majority would revolt. Without the majority's consent, a purely free market system would only exist if there is a dictatorship--that means strict gun control, censorship and spying--to prevent criticism of the free market. Free market anarchism would exist only if the majority agrees.

If the majority agrees to free market anarchism, then it is impossible to establish a state. Municipalism would work only if the majority agrees to municipalism.

If the majority is convinced to municipalism, then municipalism would inevitably exist. If the majority is convinced to free market anarchism, then free market anarchism would inevitably exist. It is much harder to be convinced of municipalism than anarchism. Capitalists would fund the reunification of municipalities.

It is easier to be convinced of anarchism than municipalism. Most libertarians do want municipalism. This suggests that municipalitism is derived from anarchism.

Ron Paul, Bob Barr, Chuck Baldwin, and John McCain are Fascists

The Myth of "Dr. No"

Even though Ron Paul is generally seen as "Dr. No," if shown his voting record, he would rarely support his votes if these are votes for the states. The reason which he votes No on the federal level because he supports quasi-federalism, and actually supports massive state bureaucracy.

For example, he supports state protection of drugs. In his ABC News interview, he said that it's the states' responsibility to protect minors from recreational drugs. Also, more apparently, in a survey of his positions, Ron Paul explicitly refused to check the "Decriminalize the possession and private use of marijuana." option but checked the "other" option. He checked "other" because he advocates prohibition, he believes in his quasi-federalism that prohibition should be the states' job in order to increase efficiency.

Ron Paul also flip flopped on his drug position in an interview on CNN. When Ron Paul is accused of his racist writings, he responded that "I am the anti-racist because I support legalization of drugs." Ron Paul is lying about that and he would lie on anything, including his racist writings.

In his slashdot interview, Ron Paul supports patents and assumed that patents are helpful in increasing technology. Software patents are actually horrible because it hurts small companies who do not have any patent portfolio and is corporate welfare.

Ron Paul supports the corporate tax, supports corporations and supports raising corporate tax. The corporate tax hurts businesses and it is corporate welfare.

Ron Paul even vote for tax incentives for companies for domestic oil drilling. This would raise the taxes from the taxpayers to pay for these companies. This is distortion of market.

Ron Paul supports federal legislation on defence infrastructure and other kinds of infrastructure. He also voted for the invasion of Afganistan. He voted for road funding.

Mainstream propaganda's potence

Ron Paul supports federal legislation such as Deleting Online Predators Act and No Parole for Sex Offenders Act. They were acts to reduce federal funding to states who do not punish the so-called "sex-offenders." This is another violation of states' rights. His advocacy is evidence that he just support states for greater efficiency. Why did not he abolish all state funding instead of abolishing states that do not confirm to the "sex offender" regulations?

Contrary to mainstream media propaganda, most "sex offenders" did not have actually offended anyone, most of them are actually charged from indecent exposure. So most of the "sex offenders" are harmless. Those who are charged for raping a girl and those who are charged for indecent exposure, the 18 year-olds who had consensual sex with a 17-year old and those who harmlessly download child pornography are all labeled the same as "sex offender." There are many falsely accused "sex offenders" and the interpretation of "sex offense" is subjective. These "offences" can be anywhere from "vulgar speech" to other victimless crimes.

Another study showed that about 87% of rapes are actually statutory rapes. Between 27 and 60 percent of rape allegations are false.

Centralism over federalism at heart

Ron Paul is not a federalist because he supports many federal legislations such as tax incentives for research and development and offshore drilling. These are corporate welfare. In some things he support county control of education, even though he support states rights. He oppose state control of education and supports county control, which contradicts state rights.

"an excellent example of this was when he spoke at the value voters debate, when he spoke on marriage, he said that it should be out of even the States' hands, and that "WE should define it", which has certain implications considering the group he was speaking to (he also stated that anyone who wanted promote gay marriage should "just look up the definition in the dictionary"). Given that Ron Paul is a believer in Christ, it should come as no surprise he holds several of these beliefs."

So he is not a federalist. In his vote smart record. he support state funding for argriculture and education. http://www.votesmart.org/npat.php?can_id=296#533

He supports federal legislation of school vouchers, even though he thinks education should be county.

When he comes to federalism:

This are the levels that the laws he think should be placed:

Federal 1) Border security State 2) Civil rights enforcement Local 3) Education State 4) Environmental cleanup None 5) Job training State 6) Law enforcement None 7) Low-income housing State 8) Medicaid Federal 9) Medicare State 10) Welfare (AFDC)

He actually supports state civil rights and welfare. Why did he voted none for job training and low-income housing but not everything else? Why he did not vote none for civil rights and welfare? Because he supports state civil rights and welfare. He opposes these programs at federal level because he supports them at the state level.

His arguments against illegal immigration are based on his support for the welfare state.

Ron Paul also wants corporate taxes that are complicated that supports big corporations. He supports health care tax incentives for businesses and "tax incentives everything." He supports businesses providing healthcare. Why not individual pay? He is economically dumb. They are corporate welfare subsidies.

Federalism is fascism

States rights do not make free. States rights is shifting the populatory contest from the federal to states. It is still a popularity contest. Ron Paul does not even support states rights by the federal regulations and tax incentives which are corporate welfare.

Ron Paul supports states rights because he thinks it is practical. For example, he supports federal government to restrict abortion, but another speech he supports states rights'. He said that states rights are easier to promote pro-life. He is a utilitarian, and probably realize that states are just as monopolistic, but he likes federalism to easier.

Ron Paul, literally, is a fascist. He supports group rights over individual rights, which is the key idea of fascism. Augusto Pinochet supported corporations and regulations that benefit the capitalists. He hated left-interventionists. Ron Paul also wants to close borders because he hates left-interventionists. States' rights are also group rights.

Ron Paul is a utilitarian economist. He supports markets because they work, not because it is the moral path. Even though he is a paleolibertarian at the federal level, he is paleoconservative at the state level. All paleolibertarians are like that. The popularity contest at the states would collude and just be as uniform as the federal level. There would be no competition. Therefore, all paleolibertarians are paleoconservatives.

Paleoconservatives equal neoconservatives

The Paleoconservatives, even though they staunchly advocate "states' rights" and "anti-federalism," both referring to policies of delegating more the federal government to more local government such as the "states," actually do not support more "states' rights" than the other political parties. For example, they support the federal government delegating its cultural prohibition programs to the "states," not eliminating them entirely.

The Paleoconservatives have an authoritarian view on cultural issues. Other than their commonly held views prohibiting "nontraditional" behaviors including "drugs," premarital sex, prostitution, gambling, statutory "rape," and pornography, they have more serious views on prohibition. Chuck Baldwin stated that "One of the main reasons for marriage is to provide a safe, loving and controversy free environment in which to raise children. Growing up is hard especially in the current environment that includes messages from music, video and other media encouraging young people to involve themselves in activities that are destructive and dangerous both physically and emotionally." This implied that in addition to prohibiting "useless" activities such as "drugs" and sex, Paleoconservatives also want to ban entertainment and video games since they consider these as a waste of time and unproductive to society as a whole.

According to the platform of the Constitution Party (a paleoconservative political party), they declare that the subnational governments (the "states") should prohibit "nontraditional" behaviors. However, this view contradicts to their advocacy of "states' rights," they imply that the subnational governments cannot legalize the "nontraditional" behaviors, while advocating these subnational governments to do anything that they can.

On economic issues, the Paleoconservatives do just the reverse. They advocate the federal government to enforce property rights and to prohibit the subnational governments setting up their own "communist state." As the Paleoconservative want to prohibit the federal regulation and funding of healthcare and education, they also want to prohibit healthcare and education even if the subnational governments set up these. However, Chuck Baldwin supports the subnational governments providing health care. This view also contradicts their advocacy of "states' rights," by actually prohibiting the "states" to have the right to establish their own healthcare or education regulations and funding.

Their statements in the last paragraph actually contradicts their views. They actually support state regulated healthcare and education. They preserve state hospitals and the state schools as one of the reasons that they oppose immigration. They dislike how the immigrants supposedly waste taxpayer money by using the "free" hospitals and the "free" schools provided by the state. They never acknowledge that the value of the medical sector and the state "education" has "negative value," and actually parasitic.

We just showed that Paleoconservatives has a very narrow view of liberty. In cultural views, they completely disrespect liberty. The Paleoconservatives speak of liberty to refer economic liberty. We should measure economic liberty by determining the amount of state intervention: less state intervention means more economic liberty. However, the Paleoconservative definition of economic liberty seems to only consider the taxation rates, without even discerning any other variable, like business regulations. They that taxation rates primarily determine the economic liberty, with more economic liberty from lower taxation rates and less liberty from higher taxation rates. Chuck Baldwin did not even include any economic sections on his platform.

Even though they view the definition of liberty as narrow, but they also determine the overall amount of taxation narrowly. For example, Paleoconservatives often view a progressive tax as less economically free than a regressive tax, even though the progressive taxation implementation has less culminative taxation. In addition, they lacked another tax: inflation, a regressive tax.

On foreign policy, they view America as similar as what the neoconservatives view it. Though on said on the platform that they officially oppose the Iraq war, they actually advocate attacking Afghanistan. Additionally they believe in punishing all countries by prohibiting free trade.

On the LewRockwell site, it officially says that they advocate: anti-war, anti-state and pro-market.

Neither applies. As proven by their support on the invasion of Afganistan, support of reducing the state and lack of awareness of the Extensions of the state, they hardly support what they claim.

LewRockwell, for example, criticized paleoconservatism primarily due to their pro-tariff stances without any criticisms on any of their other policies, such as social conservatism and parasitic sectors, implicated that paleolibertarianism equals paleoconservatism but supporting free trade.

On another article supporting "privatization" of education. he claimed:

In short, if we could abolish public schools and compulsory schooling laws, and replace it all with [voucher-provided] education, we would have better schools at half the price, and be freer too. We would also be a more just society, with only the customers of education bearing the costs.

Only half the price?! Schooling has negative value, schooling laws hurts individuals. We demonstrated voucher education equals "state-controlled" education.

Bob Barr demonstrates the archetypical paleolibertarian. On his promotion website, he has a section explitly named "Spending & the Economy," which implies that he views that only cutting spending improves the economy. He did not have any deregulation plan, nothing of the extensions of the state. His other sections: namely, taxes and monetary policy, implies that he supports lowering taxes and the inflation tax without any deregulation. Though he supports federal deregulation of healthcare and education, he does not oppose these at state-level. The Constitution Party platform even opposes these at any level. The state would collude healthcare and education to reflect the federal. Multinational corporations would collude. On social issues, he jus' leave them to the states, mistaking that the de-federalization of these social programs would automatically let the states prohibit these more efficiently.

Constitutional fundamentalism

Many paleoconservatives and paleolibertarians alike, interpret the constitution as a bible. They view the constitution as a god that says always the correct thing. The constitutional fundamentalists repeat the amendments like verses in a bible. They consider amendments as "god-given" rights and seem perfectly written by the founding fathers.

The pro-gun organizations say the second amendment like a biblical verse. They view that individuals should have the "right" to own guns. They have a one-sided view.

Individuals should not have the right to possess firearms, like individuals should not have the right for quality education. Only the ones who want firearms, who can afford firearms and those who reside in a voluntary association allowing firearms should possess firearms.

Many constitutional fundamentalists, also mistakenly, see that if the state enforced the constitution, it would become smaller. However, the constitution only restrains at the federal level, not the subnational level. Once enforced, the subnational states would collude and resemble exactly as the federal level. Multinational corporations would fund the subnational states to reunite into one federal state.

One should not interpret the constitution; one should interpret the non-aggression principle.

Paleolibertarian's mercantile capitalism

Various dictionaries define a trade deficit as the a greater number of imports relative to exports. Also, these define trade surplus as a greater number of exports relative to imports. Various individuals have a false view that trade deficits harm the economy. They believe that trade deficits increase unemployment. The paleoconservative opposition to trade deficits stems from their view that trade deficits increase unemployment. Paleoconservatives including Chuck Baldwin, the nominee for the United States 2008 Presidential election, view that trade deficits cause unemployment.

However, trade deficits do not affect unemployment. Minimum wage, labor union regulations, hiring and firing costs and other regulations cause unemployment. Therefore, in a free market, we expect zero unemployment.

Many paleolibertarian economists, like the paleolibertarians, also believe that trade deficits hurt the economy. Unlike the paleoconservatives, the paleolibertarians do not think that tariffs would benefit the economy.

Many paleolibertarians have a mistaken view that the federal reserve and less economic liberty, per se, causes a trade deficit.

Foreign investment may cause trade deficits. Attractive places to invest will have a trade deficit, since these compel foreign investment. For example, strong economic liberty, inflation and intellectual "property" may increase foreign investment, which increases the trade deficit. Although libertarians should oppose intellectual property as privileges, intellectual property encourages foreigners to "invest" domestically in entertainment. A small advantage of a nation attracting foreign investment may result in a huge trade deficit. For example, if the average foreigner invests his property in a nation with 15% rate of return per year, the imports may equal seventeen times the exports. A huge deficit may result in just little increased foreign investment, for example.Â

Inflation may increase foreign speculation. Inflation encourages borrowing at negative real interest rates.

Also, we should look whether a trade deficit actually exists. Inaccuracies on calculating the balance of trade may induce a trade deficit. The state may actually conclude that a trade deficit exists when this does not. The state estimates a nation's GDP and the balance of trade. The state estimates the GDP and the balance of trade by collecting the tax statistics, such as the tariffs on imports and exports. For example, if the state collects a greater amount of tariffs from imports, it would increase the total number of imports. Non-state firms (private firms) cannot give an accurate estimate of GDP. Non-state firms lack the taxation data which can also deduce the amount of imports and exports. Individuals overwhelmingly cite the state's estimate of GDP and balance of trade over GDP estimates by non-state estimated GDP. The state estimates inaccurate statistics, since the state lacks any economic incentives to provide accurate statistics. For example, if the state left out the additional exports in the process of estimating the balance of trade, it may result in a trade deficit. The state may underestimate e-commerce and software exports, because the state does not tax the Internet. Underrecording Internet purchases from individuals in other nations yields in a trade deficit.

The Democrats and Republicans

Political positions contradict itself

We should not mistakenly divide the mainstream politics into two groups---The Democratic Party and the Republican Party. Parties mean nothing, as there exist various differences of viewpoints within each party. We should not stereotype each party. Not all Democrats support one policy and not all Republican support one policy either. For example, just because an individual supports Universal Healthcare, this does not imply that he or she would more likely oppose the War in Iraq. Just because an individual supports abortion, it does not imply that he or she would more likely to oppose taxes. Political positions among various individuals do not have any correlation with one another. However, as we see in a two-party system, one party may have a set of highly correlated political positions and the other may have opposite positions. The political positions often contradict each other within each party. Due to the two-party system, no political party have a consistent, ideological belief. In order to succeed in the two-party system, politicians must possess contradictory viewpoints in order to win an election. Politicians often lie to hold these contradictory beliefs to win. Honest politicians usually support positions incompatible to the political parties, and thus will lose.

No stereotypes

As two-party systems results in mergers which ultimately reduces to two available options, individuals who does not prefer only the two available candidates would not join any of the two dominant parties. We see many individuals in independent and third parties form because both of the parties may not match the individual's positions. Over 30% of the voters in the United States subscribe to the "Independent Party" as a result. This also reinforces the view that political positions do not correlate with each other, and shows that political parties often hold contradictory political positions and often group similar candidates.

Differences of Democrat Party and Republican Party political platforms, which more libertarian?

As repetitively proved in the last section, individuals have a diverse array of political positions that do not correlate with each other nor do they correlate with the positions on political parties. However, if one wants to compare the political party platforms just for fun, I will prove that no party, Democrat or Republican advocates a smaller state than the other.

Many paleoconservatives and those who support the Mises Institute often view that the Republican Party as smaller government. However, they have a mistaken view. The view refers to the perceived lesser taxation rates of the Republican Party platform. The Republican Party platform proposes only cutting taxes on the already privileged corporations and the upper class, at the expense of the lower class. The platform advocates a flat tax, therefore increasing the income of the working class to decrease taxes on the already privileged. Nothing libertarian about it. In fact, they actually advocate a regressive tax, funded by the regressive inflation.

In the economic issues, the Republican Platform just advocates taxation meddling and state-regulated privatization. No deregulation plans. Though they oppose healthcare subsidies, they favor the same regulations. They 100% support big-pharma, ironic for their opposition to less harmful drugs. On education, the Republican platform supports "voucher" provided education, though we disproved that voucher-provided education improves "state-managed education." Their platform supporting the parasitic No Child Left Behind Act implies that they also want standardized testing of all schools, including homeschool. They want to regulate the homeschooling curricula for standaridized testing and homeschooling teaching methods to revert into an outdated teaching method.

Another view occurs in the perceived reduction in "pork-barrel spending." The Republican Party platform, even though just as pro-war as the Democrats, advocates significant increases in the military, which may offset the combined Democrat Party welfare expenditure. McCain proposes to greatly increase military spending. McCain also approves of healthcare subsidies $2500 to each and every individual. McCain voted along with Bush 95% of the time and Obama voted along the Democrats 97% of the time.

On family values and culture, the Republican Party platform supports the death penalty for those individuals over age 18 who voluntarily had sex with a 17-year old, from their opposition to statutory "rape." The Republican Party platform wants to sentence to death those who voluntary sell "illegal" drugs and the non-violent prostitution services, similar to the Constitution Party platform. Democrat platform also, supports prohibiting non-violent "crimes," but not as extreme as the Republican Party platform.

John McCain wants to set up a cap n' trade system, equivalent to the Democratic platform. John McCain supports the bailout, wants to regulate Wall Street, supports "alternative energy" funding, and the bureaucratic deployment of solar panels, dams, biofuels, and windmills. The Republican platform supports increased state infrasture, a prelude of their larger macroeconomicplan of "free" trade, including the murdering machine that kills tens of thousands of individuals per year: roads.

On trade issues, McCain supports the WTO and other trade agreements. We do not need any trade agreements to lower tarrifs, since most countries have low tarrifs before implementing trade agreements. Also, the WTO enforces intellectual protectionism (not intellectual "property"), enforcement of envorinmental regulations and colludes all the "food and drug administrations" in the world in the disguise of "safty" standards.

The Republicans also want the NAFTA highway

The Fascist Republican Party

Is Chuck Baldwin "More Libertarian" Than Bob Barr?

An article suggests that the state tries to pass a bill that requires manufacturers to do expensive testing.

The bill requires compulsory testing of clothing, furniture, toys, games, shoes, books, CDs, and other merchandise designed for children. The tests requires all businesses to purchase expensive testing, so it would affect small businesses the most.

We will show a couple of quotes about the expensive testing process:

However, Jacobsen told WND that lead testing is estimated to cost $100 to $400 for each of her used children's books because she does not buy in bulk, and each batch of merchandise is required to be tested.

There's a big difference between me and Wal-Mart or Toys 'R' Us," she said. "They'll have a batch of 50,000. Everything I have is a batch of one because I don't know its history. I'm looking at a testing cost of about $1.2 million. I would normally sell my full inventory of all children's products for probably $15,000. So, it's effectively a ban.

All children's toys and furniture also fall under strict requirements for independent lead and phthalate testing. Some small toy businesses say lead testing alone costs more than $4,000 per item - a price some say only large companies like Mattel and Fisher Price can afford to pay.

[The retailer] estimates testing for each of her clothing articles to run between $300 and $1,500. The Consumer Product Safety Commission said it may consider exempting clothing and toys made from natural materials such as wool or wood, but paint and dyes on the products are still required to be tested.

But they are talking about $100,000 fines and jail terms of up to five years. I'm not comfortable operating with that law on the books.

The Socialist Fiscal-Conservatives

In the House of Representatives, 424 members voted yes and only one member, Ron Paul, voted against it.

The three Senate Republicans, Tom Coburn, Jim DeMint, and Jon Kyl, who voted against the bill did not really oppose it. They only oppose the way the state implemented it, and in this case they might oppose it on the federal level. If the state-level legislatures introduced the bill, however, all of the three Republicans will vote for it.1

All of the three Republican Senators want to impose their cultural and social conservative views on others. They oppose profanity, support the murderers,2 compulsory indoctrination of the English language, No Child Left Behind Act, and the so-called sex "offender" laws. By sex "offenders," we mean that the majority of sex "offenders" did victimless "crimes" but coerced to register as sex "offenders." We consider it collective punishment to conflate both the aggressive and victimless types of "sex offenders" to the Orwellian term "sex offenders." Even Ron Paul supports the sex "offender" laws.

In fact, one of the three Senate Republicans has voted for the Sarbanes-Oxley Act, (a.k.a. the Public Company Accounting Reform and Investor Protection Act) which some studies show that the Act costs $1.4 trillion in regulatory compliance. The other two Republicans did not sit at Senate when Congress passed the Act, but they would probably vote for it if they had gone there at that time. The Congress unanimously passed the bill at that time.

Even though the general population might view these Republicans as the top three fiscal conservatives in the Senate, they always had voted for farm subsidies and other massive subsidies.

References

• 1 Tom Coburn, one of the three Republicans, at his page, endorsed state's rights. The two other Republicans, Jim DeMint and Jon Kyl, support state's rights also on the discredited "greater say" argument.
• 2 Look at Jim DeMint's and Tom Cobrin's "respecting" the mass murderers pages. All of the Congressman, including Ron Paul, unanimously support the murderers as much as these Republicans do.

Hat tip to Rationalitate.

Spontaneous Centralization

The market is a self-organizing system. Spontaneous order and voluntary centralization would appear.

State centralization is forced centralization. State centralization limits competition because it sets constraints on every entity within the state. It limits creative arrangements of patterns and limits innovation.

An example of a decentralized system is evolution. Organisms that innovate, or adapt creative traits, are the only ones that may survive.

Decentralization would result in spontaneous centralization. The evolution of the bottom-up processes encourage the most successful bottom-up process to spread on a top-down fashion.

For example, entrepreneurs are competing in a bottom-up process in parallel. If one entrepreneur innovates, the idea would spread on a top-down fashion, where all bottom-up entrepreneurs competing would get the knowledge, in a fast top-down way.

Contrary to the popular belief, decentralization is not anti-centralization. It is pro-centralization. It only opposes the coercive types of centralization. In fact, the more decentralized a system is, the more centralized the system is. This is because decentralization would let the bottom-up processes to compete evolve the best plan for centralization in parallel. Centralization is then voluntary. If the centrlization is ineffective, then the bottom-up agents would voluntarily opt-out. State-enforced monopoly centralization, however, would hinder competition of the optimal centralization standard.

Centralization cannot exist without decentralization. Without decentralization, there would be no innovation, since it hinders parallel bottom-up process to compete and innovate.

State-centralization not just inhibits innovation, but also prohibits the adaptation of already-known innovations. It inhibits efficiency increases that would be adapted by companies. For example, the barriers to entry and patents, products of state-monopoly centralization inhibits the efficiency increases which ultimately lowers the purchasing power of its citizens.

State-communist societies are highly coercively centralized. They inhibit certain kinds of knowledge to be applied. These decrease efficiency, which reduces productivity.

Coercive centralization inhibits the innovation and the application of technology. Agorism is more efficient because it decentralizes which would let entrepreneurs exploit the effieiencies and technologies that are prohibited by the state.

Many economists such as Thomas Malthus argued that humans would eventually be living in subsistence. His argument is flawed, because he avoid the consequences of how technology would improve living. In fact, the lack of efficient technological application is the main reason of how socialism failed. Technology and innovation are very important aspects of living in society, and decentralization makes entrepreneurs to have the incentive to exploit efficiency.

Costs Should Not Justify Policies

Most people oppose the Iraq war and the War on Drugs because it is ineffective and too expensive. Many politicians, including Ron Paul, argued that war harms the economy because of the higher government spending. They do not have any moral reasons to oppose the war.

Government is funding a microchip implant, called the VeriChip. The VeriChip company holds a patent on the idea, so they lobby the government to mandate everyone to use it, just like the vaccination companies. The chip includes a tracking device that invades their privacy and self-government. Microchip implants have additional advantages, such as detecting the blood cocaine levels and the blood alcohol levels. The ease of detecting an illegal drug would raise effectiveness of the War on Drugs and the significantly ease the costs. Many conservative politicians would support it to fight the Drug war.

Let's suppose a new technology is invented that reduces the costs of war to a fraction. More people would likely to support the Iraq war because of lower costs. Because of the lower costs, conservatives would support it. They have no moral objection.

It is also perfectly logical for minarchists to enforce microchips on everyone to reduce costs of defence forces so government would be voluntarily funded. They install microchips in everyone's mind to reduce aggressive thoughts and thoughts about succeding the government. These kinds of minarchists are totalitarian minarchists, who proposes mind control. This is another proof that minarchism leads to totalitarianism.

Every government intervention should be morally objected, not weighed on an utilitarian basis.

Refuting Protectionist Fallacies

The mainstream neoliberal version of globalization tries to establish a world government by setting agreements between countries. The neoliberal version may support violence to bring trade between nations. Globalization tries to establish state-subsidized transportation, which distorts the "free market" to over-utilize transportation and underutilize smaller businesses, as Kevin Carson argued.

Free trade is crucial for developing countries. Both export and import tariffs must be eliminated. Import tariffs make the imports cost above the cost of production, resulting in more local producers. However, the tarrif malallocates the resources in favor of less efficient local production. Even if the tariff profits the government, it inhibits the low-price "signal" of the imports, resulting a lower opportunity costs of the producers.

Export tariffs, or export duties, are often enacted in resource-rich countries to extract revenue. An example is a tariff on oil exports in a oil-rich country that can produce oil cheaper than the other resource-poor countries. The tariff, however, even if generating revenue for the government, has unintended consequences such as damping economic growth. A tariff, like this one, would lower the supply of oil producers because the tax would make oil production less profitable. The lesser profits from the tariff would motivate producers to invest in alternative less-profiting activaties, which would result in overall decreased efficiency in production.

A tariff on farmers would make the excess farmers to invest in alternative, less profiting activaties.

Eliminating both kinds of tariffs would make the most efficient allocation, as the maximum number of entrepreneurs can invest in the most profiting areas first, which is crucial for economic growth for developing nations.

Freeing trade is an advantage, even if only one partner freed and the other partner has a heavy tariff. The elimination of both kinds of tariffs without any agreements would result in a comparative advantage for the nation. There exists a dominant strategy for a partner. It is to eliminate tariffs. In the payoff matrix, even if one partner cooperates, the partner would gain. Countries can improve without any agreements, but just eliminating both kinds of tariffs on all of its resources. "Free trade" "agreements" are bad.

"Trade deficits" and "trade surpluses" are not a problem. If the imports exceed the exports, then it signifies that the country is more self-sufficient: it does not need to export to earn money. Developing countries export more than imports because they are less self-sufficient. Developing countries must export to make money because they do not have many efficient capital goods. When they get more efficient, they get more self-sufficient then export less and import more.

Protectionism would raise the wages of the workers at the expense of the middle and upper classes. If a good costs B in a foreign country and costs A if domestically produced, the buyer would save (A-B) if there is free trade. If protectionism is involved, however, the buyer must buy the good priced at A and the difference (A-B) nominally goes to the workers. Let's say the ratio of money saved by buying traded goods in free trade over protectionism is R. Let's also say that if free trade is enacted, the workers' current job C would gain an alternative job that pays D to the workers. If there is free trade, the workers would benefit D. If protectionism is enacted, the workers would earn (C * (1/R)).[2] Let's say that if free trade is not restricted, the workers' pay decreased by (A-B), which is equivalent to (C-D). So [2] is equivalent to (((A-B)+D)*(1/R)). The middle class buyer would earn (1/R). This is flawed. A-B and C-D is not equivalent because the marginal cost of labor does not equal the product costs because of the overhead of raw materials. Welfare is more efficient than protectionism.

For example, if a imported good costs $3, and would cost $5 if domestically produced, the buyer would save $2 in free trade. However, if protectionism is enacted, the buyer would have to pay $5 and the workers earn an extra $2. However, forced welfare redistribution is more efficient, such as taking $2 from the buyer and giving it to the worker.

If free trade is not restricted and an alternative wealth redistribution law is enacted, then the workers may only earn $2, wealth redistribution from the buyer giving $2 to the worker and an extra $2 because imports are less expensive, then the worker would earn $6, which is higher than the protectionist $5.

Free trade is better for the nation. Wealth redistribution to the working class is better than protectionism.

Immigration Restriction

Free trade of commodities would equalize one
price for the commodity.

Proof:

Example of highly tradable goods include commodities such as food and clothes. Non-tradable goods include goods and services such as education and healthcare. Because labor is relatively cheap in poorer countries, the cost of non-tradable goods would tend to cost less in poorer countries than in richer countries. This phonomenon is called the Penn effect.

Tradable goods, however, would tend to result in result in one price around the world. This occurs because products created by cheap labor in poorer countries would be exported to richer countries to sell. All countries would demand products from the same poor country that these cheap goods are produced, which would emerge in one price. Contrastingly, non-tradables cannot be exported and traded to richer countries, thus richer countries tend to use more expensive products from their own more expensive labor.

The emergence of one-price around the world for tradables is called the law of one price. The price of these tradable goods are proportional to the exchange rates of various currencies around the world.

Q.E.D.

So free trade would make things more competitive.

Some non-distributable goods such as education and barbars cannot be distributed to other countries.

So poorer countries would subjectively value education and barbars cheaper than richer countries. And richer countries would value these more expensive.

Purchasing power parity only measures redistributable goods, not non-redistributable such as rent expense barbars and education, etc. Non-redistributable goods cost differently in different
locations

But free immigration of teachers and barbars would
even the price of education and barbar fees throughout
the world. Therefore, free immigration would encourage these
non-distributable goods at one price,
and allocate them efficiently

So racial homogeneity by restricting immigration has a cost: encourage monopoly costs of non-redistributable goods.

(but the current trend of online education and machines
would minimize these disparities)

Biases in Conceiving Anarchism

Many people in anarchism argue assuming geographical assumptions. For example, people assume that it is impossible for individuals to have property that extend a long distance. This is false, individuals can have telephone poles and cable television cables that extand a long distance. It is their property.

Another assumption is that it is impossible for individuals to be located at two different places. People can live in one place and have a body part at a different place. For example, a human can be located at one place but his cell phone can be connected at another place.

Another assumption is that the universe is flat. People can have 3D space, such as the atmosphere. They can fly airplanes in the air.

Another assumption is that you cannot cross a fense of a house without the owner's consent. This is false. You can fly airplanes above the fense, and you are still crossing it. You can fly a helicoptor above the area surrounded by the fence.

Another assumption is that you cannot go "inside" the owner's property without another's consent. Yes you can, such as standing beneath a bridge, or digging a hole in the ground to build a underground subway that is under the owner's property.

Another assumption is that states must be residing in geography, not underground or is shaped like a thin fiber. This is false. The state can be shaped like a fiber, such as the government uses internet fibers to enforce laws.

Another assumption is that a state cannot reside in separate geographical places. This is false. A state can be connected virtually by using cell phones in military individuals in different places. Alaska is resided in a different location than the United States, but still the same state.

Another assumption is that states require stable geographic locations. This is false. States can be nomadic. States can move. States can behave like cars and airplanes.

Anothe assumption is that individuals are seperate. However, individuals can be connected by using shared internet-cables and shared roads.

These assumptions create non-sequitur arguments. Avoid assuming these assumptions when arguing.

If these assumptions are not believed, then people would more easily believe in anarchism. For example, PDAs would be equivalent to mini-states. PDAs and states are similar. As states do not require to be in stable geographic locations, it would behave like PDAs because PDAs can move and states can move.

There exist an anarchist relation between two states. However, the anarchist relation is not violent. PDAs can behave like states. There exist an anarchist relation between different PDA firms. An the PDA firms would not be violent to each other similar to states.

People also assume that PDAs must be controlled by one boss. This is false. PDAs can be similarily controlled collectively, and have an interneal checks-and-balances system similar to a state. It is likely that almost all PDAs would be collectively controlled, just like the state, in anarchy.

So PDAs are no different than mini-states if these assumptions are not assumed. If people do not assume these things, their logic would lead to anarchy.

The Invalid Presuppositions Behind the Free Rider Problem

Free rider problem cannot be solved.

One example of an absurdness of the free rider problem is the utility. Politicans lie that we need to solve free rider problem for "defense." This is an example of subjective value, that foreigners are threats to us. This demonstrates that value is subjective so one person that thinks that we need funding but some people do not need military funding.

One example of the absurdness of the free rider problem is the emphasis on numeric.
If 99% of people agree that global warming needs to be funded but 1% does not agree, the 1% is a free rider. But if 1% agree that global warming needs to be funded and 99% does not agree 99% is a free rider. Neither group is corrupt. The free rider problem is dependent on majoritarianism. Even if 99% say it requires funding because of the free rider problem, it does not state that if global warming is actually true. Even if the 1% free riders does not fund, it does not mean that the other 99% is correct, similarily the reverse 99% 1%. Hence, free rider problem is a problem of it actually requires funding.

Therefore, free rider is based on the assumption that the funding is required. It is also egalitarian. it assumes that everyone needs it, including th 1% or 99%. And our current arguments for the free rider problem can be solved by market anarchism. And sometimes we do not actually need market funding. It is also utilitarian.

There are solutions. People can come up with a reasonable way for funding by giving contracts to see if they accept the methods of funding. If given a contract that
states that a rich person should fund more than a poor, they have to all agree to it.

Also, this suggests that the free rider problem is based on imperfect information of the number of people that agree to fund. If the individuals know who would fund or not, they can resolve in a efficient allocation. But because free riders frequently hide their actions if they would fund or not, they are hiding information. Because imperfect information, people would think that other people would fund.

Open source has perfect information so some people have an incentive to develop open source software.

Firms would work together for defense, they would come up with a solution similar to nuclear disarment between states they would reduce this to optimal. So automatically people would reduce their funding despite the free rider problem.

The Insurance Solution

Deregulate traffic controls, and let the market solve it. Every less state regulation gives an opportunity for the market to innovate a solution.

Suppose that the state discontinued its operations of traffic lights, while keeping all other traffic regulations intact. 

If the state completely deregualized roads, then removing traffic lights will not result in any problem. It will function as a club good, and private road owners will have the incentive to provide traffic lights.

But this example discusses the problem when the state has suddenly abolished traffic lights, while  the state still controls the roads.

At first, many individuals, even some anarchists, will predict that it will result in failures and slower transportation time. Since the state still publicly provide roads to anyone, discontinuing its provision of traffic lights will presumably cause behavior as in the tragedy of the commons.

However, this does not provide any problem for all drivers. Once eliminating traffic lights, the car insurance firms will have the incentive to rebuild traffic lights themselves. The elimination of traffic lights will result in a flawless, almost instantaneous transition for the firms to build new traffic lights. Once these efficient firms manage traffic lights, they will improve the design and implementation of traffic lights, with innovative and  safety features.

This traffic light example behaves similar to the lighthouse problem. While water exemplifies the lighthouse scenario, roads exemplify this scenario.

Defending state regulation, even regulations that supposedly fixes other regulations, resembles  an individual advocating theft by taxation. Every regulation enforced by the state hinders the opportunity for the market to provide an alternative.

Even in some rare cases when deregulation makes ``society" worse off, it will instigate pressure from the population to fix its things.